MTN Group will invest US$1 billion in Ghana over the next five years after the government exempted its Ghanaian unit from back tax claims worth about US$773 million.
“We will invest an equivalent of $1 billion of capital expenditure over the next 5 years. We see 5G as a technology that could spur faster growth with industrial use cases in mining, agriculture, oil, ports, logistics and smart cities over time,” President and CEO of the MTN Group, Ralph Mupita said in a statement.
The investment comes on the heels of the Ghana Revenue Authority (GRA) scrapping MTN Ghana’s back tax bill earlier this month after the incident led to revelations that the entity that did the tax assessment, Safaritech Ghana Limited is shady and dodgy.
The back tax claim also spark diplomatic intervention from South Africa, where a Minister accused Ghana of discriminating against South African companies in Ghana.
The tax claim was initially issued after the GRA commission Safaritech to audit the company for the years 2014 to 2018 and inferred that it under-declared its revenue by about 30% during the period.
MTN disputed the claim and went into a 21-day negotiation with GRA, at the end of which GRA completely scrapped the back tax.
MTN CEO Ralph Mupita said the company was committed to investing in Ghana despite short-term headwinds.
“To be sure, macroeconomic conditions are very challenging in the near term. That said we are focused on the medium and long term and we are seeing growth,” he added.
Mupita said “The crowding in of private long-term capital will support economic recovery efforts and spur growth in our view. We are here to play our part as a partner for socio-economic progress.”
MTN Group has been investing in Ghana for over 25 years. Since the beginning of operations in the market, the business has been integral to the economy of Ghana, focusing on enabling connectivity, inclusivity and socio-economic transformation through digital technologies.
MTN Ghana has a subscriber base of over 24 million and continues to drive significant growth numbers in data and mobile money in spite of regulatory constraints due to its signnificant market power (SMP) status in Ghana.
For one, MTN has just launched a new set of number with a 053 prefix, and again, it is promoting a thriving telecommunications industry, by enabling customers of Vodafone and AirtelTigo to remain connected across the country through roaming agreements with MTN where they do not have the infrastructure in place.
In addition, the Group recently opened a Customer Success Centre for MTN GlobalConnect’s pan-African operations which is phase one of our greater investments in Ghana and an opportunity to onshore digital skills into the market.
Mupita concludes: There are short-term headwinds but the investment case for Ghana remains very compelling.”
